Wal-Mart enters India in 50:50 JV with Bharti
06 August 2007
The world''s largest retailer Wal-Mart Stores Inc and Sunil Mittal''s Bharti Enterprises today announced the entry of Wal-Mart in India with the signing of their equal joint venture agreement that had been awaiting government approval for the past several months.
The wholesale retailing venture, Bharti Wal-Mart Private Ltd, is a wholesale cash-and-carry and back-end supply chain management, the two companies said, in line with government of India guidelines that prohibit foreign multi brand retail operators in the country, though foreign single-brand retailers are allowed a 51-per cent stake in joint ventures.
The JV will open 10 to 15 cash-and-carry facilities over seven years. The first of the stores, which will sell groceries, consumer appliances and fruits and vegetables to retailers and small businesses, is slated to open in north India by the end of 2008.
In addition, Bharti Retail, the 100-per cent subsidiary of Bharti Enterprises, that will own and manage the retail stores, has entered into a franchise agreement with Wal-Mart, which will provide technical support to Bharti Retail.
"We are delighted to partner with Wal-Mart for wholesale cash-and-carry and back-end supply chain management operations in India," said Sunil Bharti Mittal, chairman and Group CEO, Bharti Enterprises. "Wal-Mart''s global expertise in supply chain and logistics will bring enhanced efficiencies across the retail ecosystem.
"This venture promises to bring great value to millions of farmers, artisans, small manufacturers and retailers across India. We are pleased to be a partner in developing this sector which is set to become a significant engine of India''s economic growth," he added.